Take-Two reported that it earned over half its revenue from mobile in the last financial year, and has hailed two Zynga hits for driving the growth.
Rollic’s Color Block Jam is already profitable after just four months on the market, said Take-Two. Match Factory continues to perform well too, and CEO Strauss Zelnick was also bullish on Zynga’s direct-to-consumer business:
“While we’ve been implementing D2C in our titles for some time, we do believe there’s an even greater opportunity to expand this highly accretive channel given recent beneficial court ruling,” he said in the earnings call that followed the results.
Looking forwards, however, Take-Two did say that it expects mobile revenue to be fairly flat. It plans to launch five new mobile games in the next FY, it said, including WWE2K through Netflix.
Q4 results:
- Net revenue, mobile: $747.7m (up from $715.1m a year ago)
- Revenue by platform: mobile 48%, console 37%, PC and other 15%
- Total net revenue: $1.58bn (up from $1.4bn a year ago)
Full year:
- Net revenue, mobile: $2.9bn (up from $2.7bn a year ago)
- Revenue by platform: mobile 52%, console 37%, PC and other 11%
- Total net revenue: $5.63bn (up from $5.34bn a year ago)
Referencing the success of Color Block Jam and Match Factory, Take-Two CEO Strauss Zelnick also characterised Zynga as “the only company in the space that is regularly creating new native mobile hits”.
He went on to describe the recent US court ruling that allows developers to offer players relatively frictionless direct payments on the US App Store as a plus for its mobile business.
“We entered the direct to consumer business in mobile immediately upon closing the acquisition of Zynga, and it’s become a significant and indeed material part of our business,” said Zelnick.
“I’ve been saying for years that I expected the cost of third party distribution to decline,” he continued. “I’ve also been saying for years that I believe the whole business would open up more than it has been. I do think the recent court rulings reflect movement in that direction. It is early. However, these are all positive signs for us.”
